Restraint of Trade

Employers are often unaware of the implications and importance of restraints of trade.

A restraint of trade is a legal contract between an employer and employee, or the buyer and seller of a business, which prevents the employer or seller from working in a similar business within a specific geographical area and within a specific period of time.

It is meant to protect a company’s trade secrets and confidential information but it can also be incorporated into employment contracts in order to protect your business interests once an employee has left that business – either of their own volition or through redundancy or dismissal.

There are various factors which much be taken into account when drafting a restraint of trade such as the reasonableness of the clause and its scope and duration.

Restraint of trade can be a very effective tool for protecting your business but only when it is properly considered and drafted. There is little point in having a clause that is unenforceable.

Our employment team can advise you on the best methods of protecting your business interests, working with you to ensure that any restraints of trade are effective and enforceable.